USAA Insurance Review

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USAA is a large insurance and financial services company with a unique market; they serve members of the U.S. military and their families. For nearly a hundred years they have been providing a range of insurance products, covering home, auto, life, and more for service men and women.

Marketed as the company that understands the needs of military families, they have a few features to their products you won’t find elsewhere.

USAA Summary

USAA opened it’s doors in 1922 as United States Army Automobile Association, providing car insurance to military members who were having trouble obtaining coverage elsewhere due to insurers who considered them high-risk. Two years later they opened up their products to members of other branches of the military and changed the name to United Services Automobile Association (USAA).

In the 1960s, USAA expanded its product range to include homeowner’s and life insurance. They have a large headquarters in San Antonio, TX, and also have offices in England and Germany.

USAA is not a corporation, but rather an inter-insurance exchange. This basically means that all of the policyholders insure each other, and are all owners of USAA’s assets. There are no stock or shareholders, and the company’s profits are kept either as assets or returned to the policyholders – we’ll take a closer look at how that works further down in the section on Subscriber’s Accounts.

USAA is a full-service insurance and financial services company, offering banking, investment services, retirement planning, and more in addition to insurance policies. Some of their policies are underwritten by wholly owned subsidiary companies. They meet nearly every insurance and financial need that the average person could possibly need, making them a popular choice.

USAA ranks as the 6th largest auto insurer in the nation according to a 2015 Insure.com study, and the 10th largest property & casualty insurer according to a 2014 FIO report. That makes it pretty clear that limiting their market to the military is not hurting the bottom line. In fact they continue to show a lot of growth and are likely to continue that way.

Who Can Join USAA

USAA is different from most insurance companies – many may offer affiliate discounts, but they don’t cater to one specific population. In order to obtain insurance from USAA, you will need to be eligible. The website provides a questionnaire to help people determine whether or not they will qualify.

A basic list of qualified people includes:

U.S. Military personnel and officers, whether active, retired, or honorably discharged

Children of current or former USAA members who had auto or property insurance

Academy cadets and midshipmen, those in ROTC (Reserve Officers Training Corps) on scholarships, and officer candidates

Former USAA members who have had auto or property insurance

Widows, widowers, or former spouses (who are not re-married) of USAA members who had USAA insurance while married

USAA has historically offered products to members of certain government agencies as well, but some of those rules have changed recently. It’s best to check with the company to determine if you qualify.

Insurance Products

USAA offers all of the basics of personal insurance as well as some specialty policies. Their product range is fairy comprehensive, so they are likely a one-stop shopping option for many people.

Auto Insurance

Auto insurance is USAA’s original product they have been offering for almost 100 years. USAA offers everything you would expect from a comprehensive auto policy, including liability, comprehensive and collision, and many other options. Discounts include many of the choices offered by other major insurance companies along with a few more unusual ones.

Here are some of the available discounts:

Safe Driver

Defensive Driving Course

Good Student

New Vehicle

In-Storage discount of up to 90%

Military Installation discount for cars kept on military bases

Loyalty

USAA auto policies also include roadside assistance and guaranteed renewal as long as you meet a few simple eligibility requirements.

Collector car insurance is also available, although it is underwritten by a different company.

Homeowner’s Insurance

Insuring a variety of homes, including single-family dwellings, mobile homes, and condos, USAA home insurance provides a number of features:

Full replacement cost coverage for the home itself

Personal property coverage up to 75% of the home’s insured value

Up to $5000 in identity theft coverage

Coverage for assessment costs charged by condo associations

Personal liability coverage

In addition to insuring owner-occupied dwellings, USAA writes rental property coverage, which caters to the needs of landlords. Coverage includes dwelling protection, liability, and loss of income from a home that is vacant during repairs under a covered loss.

Renter’s insurance

This type of policy is designed to cover the personal property of those who are living in a rental property. It also offers tenants liability coverage and other features and benefits. Because renters don’t need structure coverage, this policy is usually very affordable, and is even more so with multi-policy discounts.

Valuables and Collectibles

USAA writes policies to cover high-value items such as jewelry, art, musical instruments, and collectibles. The Valuable Personal Property policy is written as a stand-alone, but you are required to have a USAA homeowner’s insurance policy to qualify.

The Collectibles policy can cover a variety of collections including memorabilia and more, and is also a stand-alone policy that does not require an underlying policy. It’s fairly unusual for insurance companies to offer stand-alone policies of this nature, and collectibles are usually included under other headings, so that makes USAA stand out in terms of covering special items.

Motorcycle, Moped, and ATV

USAA writes policies for a variety of motorcycles, mopeds, scooters, and ATVs. They offer discounts for members who have other policies with the company and a series of other discounts including safety course. Their motorcycle insurance covers all of the basics as well as a variety of motorcycle-specific benefits.

Like their auto insurance, USAA includes roadside assistance with these policies as an added feature. Motorcycle insurance is underwritten by a third party.

Watercraft

USAA has insurance for a variety of watercraft, including pleasure boats and personal watercraft. They offer several discounts with these policies as well, including safety course discounts and a multi-policy discount for insuring more than one watercraft.

Motorhome

USAA offers this product underwritten by a third-party company to cover motorhomes. The coverage includes vacation liability and emergency expenses, as well as coverage for the motorhome itself as a vehicle. These policies also come with roadside assistance, just like all vehicle insurance from USAA, which is a nice perk on a motorhome, since towing and other assistance can be very costly.

Aviation

Aviation is one of the more unusual products offered through USAA, although it is not underwritten by the company. It covers personally owned aircraft, aviation businesses, and has higher liability limits available. It will also cover you when flying an aircraft that is owned by someone else.

Finding a product like this from a major insurer definitely sets USAA apart and also points to their military connections.

Life Insurance

USAA has a basic range of life insurance products available, and caters to the needs of military personnel by offering life policies that do not have the standard war exclusion. Life products come in four main types:

Term Life

Military Term

Whole

Universal

Additional Products

USAA has a list of other products to round out their offerings: umbrella, special event insurance, pet insurance, travel insurance, and even small business insurance. They also write flood insurance through the National Flood Insurance Program.

Prices and Premiums

USAA offers online quotes as well as over-the-phone services, but you must have a login to the customer portal in order to obtain quotes. This makes it more difficult to comparison shop, but is likely intended to avoid providing quotes to those who are not eligible for the products but may not realize it.

Because of the very specific market for USAA, they do not tend to show up on comparison shopping sites, and if it was not for their fairly major advertising presence in recent years, it’s likely most non-military customers would not even know they existed, much less request a quote.

Like most insurance companies, USAA promises big savings, averaging $434 per year for those who switch. Also like other insurers, we have to remember to take this number with a grain of salt, because it only includes those people who actually switched and doesn’t take into account anyone who was not pleased with the quote and chose to stay with another company.

That said, they do have a reputation for offering affordable car insurance rates, and they offer a pretty good list of discounts that are likely to help keep rates down.

Subscriber’s Accounts

As previously mentioned, USAA is a membership insurer, which means that anyone who has a policy is also an owner of the company. USAA uses something called a Subscriber’s Account through which they distribute any profits that are not retained to maintain the company’s financial strength.

Capital is allocated to these accounts and a portion of that money is returned via check to members each year, as long as there is enough of a surplus to do so. As an added bonus, any member of more than 40 years duration gets a Senior Bonus that is 10% of the account balance.

USAA has a simple FAQ regarding how these accounts work on their website. When a membership ends, the Subscriber account balance is paid out in full; this applies even when a member passes away as a benefit to any surviving family members.

Distributions from this account can certainly be considered a bonus that adds value to the policy and can offset premium cost. It is something well worth keeping in mind when comparing USAA rates against other companies.

Advertising and Media

Not surprisingly, all of USAA’s advertising is directed at military personnel and their families. Also not surprisingly, the company takes a patriotic approach to selling its products and common themes are support and gratitude to the military for their service, and pride in serving them in return.

USAA is also involved in sponsorship, including the NFL – they were named the NFL’s Official Military Appreciation Sponsor. They also sponsor the annual Army-Navy college football game. You’ll of course see their name as sponsor on a long list of military charities and groups, which is in keeping with the company’s market and goals. USAA accepts requests for sponsorships and donations through it’s website, something that is not often seen.

As a direct marketing company since its inception, USAA has always relied on a lot of word-of-mouth and direct campaigns, but has stepped up its game in television and radio advertising in recent years. The company’s advertising spots are much more visible than they were even ten years ago, but the message has stayed the same. As a result of the advertising, the company has seen a lot of growth. Surprisingly though, they have moved in recent years towards tightening their list of eligible members, something that seems to reduce their customer base a bit.

The only particular area of the survey that showed a rating on the low side was the Service Interaction part of the claims service, where USAA got only 3 out of 5. However, compared to the ratings with other companies of a similar size, this ranking is stellar.

Claims can be filed in a variety of ways, making it quick and easy for customers. The website offers all of the information you need to file. Choices for filing are:

Roadside assistance claims and auto glass claims can also be handled through the same online service. Members can follow up on claims easily online or by calling the same phone number for an update.

The mobile app allows quick upload of pictures from the accident scene, request roadside assistance, and view the status of your claim. This is the type of service that is quickly becoming expected from major insurance companies.

USAA also has disaster assistance teams with mobile claims units that can arrive on the scene of major catastrophes to assist members with recovery and claims handling. Again, this is an expected service for a company this large, and USAA seems to have this well in hand.

Claims process information is not readily available on the USAA website, nor is it easy to locate the online claims center, which should be front and center on any insurance website, since it’s one of the major reasons for people to visit the site. While USAA is certainly offering the technology to handle claims the way today’s insurance customers expect, their access to this information is somewhat lacking.

Consumer Feedback and Ratings

We’ve already noted how well USAA scores in claims satisfaction, which is a huge part of any insurance company’s reputation, but there is more to a well-rounded customer service experience.

Again, USAA scores very well in J.D. Power’s 2017 Insurance Shopping Study, ranking 5 out of 5 just as with the claims satisfaction. Only one company ranked as well, although overall insurance companies tend to rank better in this type of survey – it’s fairly easy to get good service when it comes to buying a policy, but less common to find an equally good ranking for the claims side of things. Most companies do well when taking your money, but when it comes to paying out claims, fail the test. USAA ranks well on both ends.

USAA is well known for consistently rating high on various customer service surveys and reports. They have won numerous awards over the years and are almost always found at the top in any sort of rankings. That said, there is some reason for concern that things could be changing.

The Better Business Bureau gives USAA an A+ rating, and there have been 1405 complaints against the company in the past three years, with 524 in the past 12 months. That’s a middle of the road complaint level for a company of this size.

Bottom line is that while it’s not an extremely large number of complaints for a company as big as USAA, it is higher than some competitors – surprisingly so considering high rankings elsewhere.

One of the major things that jump out from the reviews written by USAA customers is that they feel the company is not as good in terms of service as it once was. The common refrain among complaints is that people who have been insured for many years have seen service go downhill. Some of the complaints include large rate increases, rude customer service personnel, and claims that have been processed poorly or denied.

Complaints found in large numbers on ConsumerAffairs.com really seem to bear this out. There are 156 one-star rankings out of 199 total rankings. Only 23 five-star reviews appear on the site, which is really not unusual for a company of this size on this site, and on similar sites.

Keeping in mind the fact that most people only write a review of a company when they are unhappy with the service – sites like ConsumerAffairs are basically a place to lodge complaints – the common complaints raise some questions regarding whether USAA will continue to receive such high survey ratings in the future if there is in fact a change in the way they are treating customers. This will be something to watch in the future.

Bottom Line

USAA is a highly rated insurance company that is almost always ranked at the top for customer satisfaction. They are generally known for good rates and offer a good list of discounts across the board on their many products. Overall, they are one of the best-rated major insurance companies in the nation.

The bad news is that USAA only writes policies for a very specific market, therefore those who are un-eligible, none of the many perks and accolades have much bearing. For those who do qualify under the eligibility requirements, USAA is well worth considering and likely to be a very good value.

With a wide range of products, USAA can meet most people’s insurance needs, and they can further cover all kinds of financial needs as well, allowing you to keep everything under one roof. They even offer some benefits other insurance companies don’t, specifically targeted at military members and their families, which will further enhance their appeal. Some increasing complaints about the company are worth keeping an eye on, but may simply be a symptom of growth.

If you meet the requirements, USAA is definitely worth considering for your insurance needs.Get a Quote From USAA

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Review Information

Summary

Reviewer

Eric Stauffer

Review Date

2017-06-10

Reviewed

USAA

Author Rating

4

About Eric Stauffer

I am a former insurance agent and banker turned consumer advocate. My priority is to help educate individuals and families about the different types of insurance they need, and assist them in finding the best place to get it.

Reader Interactions

Comments

I thought I made a good decision switching from State Farm. Late December I had to file a claim. Liquid messed up the wiring in my Camry. After New Year’s I dropped it off to get fixed. It SAT for weeks!!! The service advisor at the dealership and the appraiser kept claiming the other wasn’t answering the phone, didn’t get total cost breakdown. Yet I wasn’t updated that it wasn’t being fixed. I had to pay out of pocket for a rental before the damage was “approved.” I had the rental for weeks and had to go to the dealership MYSELF to get the paperwork and email it to the appraiser who never said anything back to me but told USAA the info still wasn’t adequate. So after another weekend, I call USAA frustrated, wanting to speak to a manager and complain. I was told the check was sent out (on a Sunday….idk). That it would be received in a few days and repairs shouldn’t take long.
Later in the week the service advisor called and said the car was done but they still hadn’t received a check! ANOTHER weekend passed and today the RENTAL car company called me saying USAA called them at 5 pm to tell THEM (not me) that my rental wasn’t covered beyond the previous Monday…..WHEN THE CAR WAS STILL BEING WORKED ON. So I’m told, return the car by 6 pm, at rush hour in Atlanta. Seriously. I hop up, get to the dealership. Service advisor has to leave, he’s off. The person who deals with the checks is gone as well AND they can’t release my car because the check still wasn’t received and they can’t release it without at least having half.
I had a breakdown when I left. I’m crying down the highway, anxiety through the roof. Emotionally drained over this whole issue.
THIS whole month-long ordeal is causing me so much stress. I have to pay the deductible, can’t take the rental out-of-state, can’t really do anything. It’s stopping me from doing a lot. Plus I can’t afford a rental on my own right now, I don’t make much. So I will have to be without a car until everybody gets it together. First I was doing appraiser duties for free and I’m the one having to suffer. I hate that I have them and will try to reach corporate because half of how my claim was handled, does not even seem legal.

So much for my 29 years with USAA. I have been with USAA since 1988 and I would say something major changed about 8-10 years ago. The manner of service definitely went south and I let them know thinking they would want to correct their manifesting shortfalls. well…after another 10 years of increasing rates, excuses, bad service and sometimes rude service I reluctantly am learning that loyalty to USAA is disappointing. I have never mad a claim so I don’t have first hand experience to how they perform, but I have heard stories. I changed auto insurance about 6 years ago when GEICO saved me $500 a year with better coverage. This year they raised my homeowners insurance $200 and my attempts to discuss trying to come close to other companies…lost the call, didn’t get called back and when I called back I had to start all over again. They tell you how wonderful they are and say their policy is to return the call…but that has never happened, in my experience.
The bottom line is if they don’t care about their cash cows of almost 30 years without paying out a dime in claims…they just don’t care. We service members learned a different work ethic than they practice today, I will take the Auto insurance savings with GEICO, and the $400 savings on Homeowners the Farmers and save $800 per year!

We applied for an online quote for Homeowners insurance on our property. We received a quote $560mth. This was 5 times higher than quotes from other companies. So we called to confirm and after a few disconnects we spoke with a licensed insurance agent. Seems like every question I was put on hold. After about 30 minutes on the phone they said they could not provide us with homeowners insurance because we were renting out a part of the home to seasonal vacationers.
So our search continues.

What a terrible company. I was rear ended and my car and driver that were covered by USAA. My car was badly damaged and just ‘drivable’ enough to get it home (rear end, lights and muffler smashed). USAA would only pay for a rental from the time their recommended shop ‘began work’ on my car. Their shop couldn’t start work for 10 days, so I brought it to my shop who started work right away. My shop and USAA are in dispute over damage amount, so two weeks in, my car is still being repaired, and USAA just stopped paying for my rental car. I have used my shop two other times with my insurance provider (deer hits) and my provider and shop worked great tother and for me.

I have had the worst experience with my auto claim with USAA. They have not paid for my rental car which was over $800.00 and they have only paid for 90% of my auto repairs. The body shop had to fight them to get them to pay that much. I am at this point out about $1600.00 and I may have to eventually go to mediation to get this resolved. They are very uncaring and are bad about returning phone calls. I have even spoken to management and have not gotten any resolution.

Everything you say sounds very familiar. My wife and I battled USAA for nearly a year to pay a relatively modest water damage claim after the water heater in our condominium burst and damaged the ceiling in the unit below us. USAA looked for every excuse not to pay the claim until we threatened to sue them for “bad faith.” My wife and I had been insured with USAA for more than 30 years since I was a Lieutenant in the Marine Corps. The claims department is horrible. They treated us (their insureds!) like criminals as if we could not be trusted to tell the truth. My wife and I were forced to advance the repair costs so that our neighbors’ unit could be repaired. USAA did not reimburse us for over ten months. Needless to say, my wife and I canceled all of our policies with USAA (home, auto, and umbrella), canceled our USAA VISA credit cards, and moved our two retirement CD’s to another financial institution.

You should check more carefully. USAA used to be this way, but over the last few years it has changed significantly. Including dropping guaranteed renewal. Now it is basically like any other insurance company. In the past when I would get cold calls to try a new insurance company I could just say I had USAA and that would end the call. Not anymore. I been looking around and I will probably change carriers when my renewal comes up.

USAA is a lousy, dishonest, and horrible company. My wife and I had home and auto insurance with USAA for 34 years (we first purchased the insurance when I was in the Marine Corps). Eighteen months ago, we suffered our first liability loss when the water heater in our residential condo burst and caused water damage to the two units below us. Total damage was about $13,500. USAA never disputed that our homeowners’ policy covered the water damage, but the adjusters kept looking for every excuse not to pay the claim. This forced my wife and me to pay for the repairs ourselves. It was only after my wife and I threatened to sue USAA did USAA’s lawyers confirm that their adjusters were 100% wrong and my wife and I were 100% right. We were ultimately reimbursed by USAA, but it took a full year!

Also, during the first Iraq war in 1990-91, my Marine Corps reserve unit was activated. I had an existing life insurance policy with USAA for $100,000 and I asked the company if I could increase the limits to $200,000 to better protect my wife. USAA said no, that they were issuing no new life policies and freezing all existing life policies because of the pending war. What a great company. USAA promotes itself as the insurance company of military members, but it’s a total lie. They don’t give a damn about military members, just their bottom line. Fortunately, I was able to purchase a $200,000 life policy with Armed Forces Benefit Association just before I was deployed overseas. They had no problems issuing the policy.

My advice to any military member would be to stay away from USAA. They are a company of thieves.

USAA used to be a good company years ago, now they just exploit veterans and make false claims that they help veterans. I priced their car insurance and they were almost twice as much as Geico and Progressive, even more than State Farm and Allstate. They also will not write a homeowners’ policy in my area. When I called to ask the person I spoke with acted very surprised, good acting skills.

It seems that USAA has become just another greedy company preying on the “support our troops” popularity. Don’t be scammed.

I am a contractor that specializes in roofing, siding and windows. I have been involved in numerous claims with USAA insurance and have found a disturbing pattern of abuse of power by not only their company but their adjusters. They refuse to deal with a contractor and most of the time will error on the side of the insurance company when there is damage. You would think that a company that insures our veterans would treat them with some respect. My son is a veteran of three tours in Iraq and put his life on the line just like all of other veterans both alive and dead. Wake up and smell the coffee this isn’t just about making that money it’s about treating the people that give this great nation the opportunity to be free to make this money, with respect and honor.

I had them as my insurance company. I went off to Iraq during in Dec before the invasion, was there during the invasion through May. Had automatic payments set up.

Returned to have had them dropped. They claimed they sent me letters stating that although I was set up on auto renewal, they dropped me while I was in the war zone and unable to communicate at all and refused to renew my insurance.

I had to get new insurance as a non-renewing insurance holder which costs more.

I carry both auto and property insurance policies with USAA – which are competitive but after waiting over a month for the underwriting process on a life insurance application they tried to stick me with a rate nearly double the original estimate due to some insignificant factor… I think their underwriter employs this tactic to gouge veterans. I got the same coverage at another major insurance company for half USAA’s rate… hope other vets are careful to check other rates before they are ripped off too!

USAA applied payments from another insured to my account for 6 months now wants me to make up the $75/month difference ($375) based on calling me and making a request of me. I’m on my 6th call to USAA, have requested a detailed statement covering the last six months and am getting the run around each time. Supervisors are never available when I call. USAA may have had excellent service in the past, but no more. So disappointing for a company with which I’ve had insurance for 30 years.

I’ve been a member of USAA for about twenty years. I have trusted them, hands-down, with all sorts of issues and transactions. NO MORE! After a bad experience with homeowners insurance claims, I started looking. I changed auto, homeowners, rental (I have two rental homes) and even got an umbrella policy with another carrier for $2500 LESS PER YEAR. USAA is not the place to get insurance. I feel I’ve been ripped off for so many years.

I thought your comments about USAA potentially not being able to maintain their high customer satisfaction rates was interesting. I have had USAA for almost 10 years, and I am ready to kick them to the curb. I found this site researching alternatives to replace them. After two accidents that my wife has been in where she sustained whiplash injuries, we have found their PIP coverage misses the mark. (We have gripes about the at-fault parties’ insurance companies not taking responsibility for their insured’s actions and necessitating the use of our own PIP coverage in the first place, but that’s a whole other story) I think it’s important to note that USAA subcontracts review of PIP claims to a 3rd party company, Auto Injury Solutions. Other aspects of the claims which USAA seemingly handles entirely in-house, such as auto repairs, have been outstanding in my opinion. Regarding the PIP, they seem to be about 90% good about reimbursing claims for the first few weeks, then they start denying everything. Their explanation is that there is no objective evidence to suggest continued treatment is necessary beyond the statistical average healing times and/or that the type of treatment is not necessary considering the nature of the injuries. However, I have seen the charts my wife’s physician has submitted to insurance and each visit notes contain observable and measurable data describing the progression of healing since the last visit, the evidence he wants to see to consider her fully healed, and what he is prescribing for treatment to work towards that fully healed milestone. Not being a medical professional, but possessing a strong attention to detail and willingness to do some research, I have been dumbfounded at the incoherent and incorrectly applied rationale for denying claims. I have been successful in securing reimbursement for a limited number of denied claims (typically the 10% denied in the initial weeks of treatment) but they seem very adamant to deny any treatment beyond what they believe to be the statistical average period to heal, against all case-specific logic and reason that is well documented and supported in the physicians charts. I personally believe they have a cost target that are trying to stay under for each PIP claim, and what they will reimburse is based on meeting or beating that cost target, not making the insured whole again. “We’re there when you need us”, they say…yeah, not so much.